Singapore stocks climb after China slashes key mortgage rate

SINGAPORE - The Straits Times Index (STI) rose 0.6 per cent, or 18.15 points, to 3,244.06 on Feb 20.

Across the broader market, gainers beat losers 281 to 251 after 1.93 billion securities worth $978.7 million changed hands.

Regional markets were mixed after

China lowered its five-year loan prime rate

more than expected.

SPI Asset Management managing partner Stephen Innes said the move shows that the Chinese government is intensifying efforts to stabilise equity markets and boost economic recovery.

“While these measures may offer some relief, managing expectations regarding Beijing’s intervention is important. The government is likely to prioritise piecemeal measures over implementing substantial fiscal stimulus packages,” he said.

He added that the Chinese government’s cautious approach reflects a shift away from its former “growth-at-all-costs” model; it is now moving towards achieving technological self-sufficiency and ensuring macro-financial stability.

While there is “growing belief” that China should adopt a more expansionary fiscal stance and enhance the country’s social safety net, the authorities do not appear to have prioritised this amid competing economic and geopolitical considerations, he said.

Hong Kong’s Hang Seng Index appeared to be buoyed by the news, rising 0.6 per cent. However, South Korea’s Kospi fell 0.8 per cent, while Japan’s Nikkei 225 was down by 0.3 per cent.

On the STI, Seatrium was the top gainer, rising 7.8 per cent, or 0.7 cent, to 9.7 cents.

Meanwhile, Mapletree Pan Asia Commercial Trust was at the bottom of the table. It fell 1.4 per cent, or two cents, to $1.39.

The trio of banks made gains. OCBC Bank rose 0.9 per cent, or 12 cents, to $13.45; UOB climbed 0.3 per cent, or nine cents, to $29.51; and DBS Bank gained 0.1 per cent, or four cents, to close at $34.17.

THE BUSINESS TIMES